Forecasting the Prices of Black Pepper

Abstract

The objective of this study was to construct the black pepper prices forecasting model by 7 statistical methods: Box-Jenkins method, Holt’s exponential smoothing method, Brown’s exponential smoothing method, damped trend exponential smoothing method, simple seasonal exponential smoothing method, Winters’ additive exponential smoothing method, and Winters’ multiplicative exponential smoothing method. Time series of monthly black pepper prices which were gathered from the website of the Office of Agricultural Economics during January 2005 to December 2018 of 168 observations were divided into 2 datasets. The first dataset had 156 observations from January 2005 to December 2017 for constructing the forecasting models. The second dataset had 12 observations from January to December 2018 for comparing the accuracy of the forecasts via the criteria of the lowest mean absolute percentage error and root mean squared error. Research findings indicated that for all forecasting methods that had been studied, the most accurate method was damped trend exponential smoothing method.